The coupons would be lower than the 3.24 percent for three-year bank deposits and 3.60 percent for five-year deposits, but investors need not pay the 20 percent in income taxes levied on bank savings.

The bonds would be sold to domestic investors from April 1 to April 30 by 37 banks including Bank of China and China Construction Bank Corp, according to the statement published by the ministry's website (www.mof.gov.cn).

The batch of treasury debt will be the fifth that China has issued since the beginning of this year and will bring the total state debt issued since Jan. 1 to 200 billion yuan.

China's treasury debt issues have racked up successive highs in each of the past few years as Beijing has covered budgetary deficits, bankrolled infrastructure projects, doled out aid to millions of laid-off workers and geared up for the 2008 Olympics.

It issued a record 704.2 billion yuan in such debt last year, beating the previous peak of 692.4 billion yuan set in 2004.

Beijing has said that from this year it will decide the volume of debt issuances on the basis of the stock of debt already outstanding.

Its previous policy was set annual quotas for the issuance each year on the basis of budgetary needs, without considering the outstanding treasury debt.

The finance ministry has said it expects outstanding treasury debt to reach 3.56 trillion yuan by the end of 2006, up nearly 300 billion yuan from the end of 2005.

To that end, it will in 2006 issue 800 billion yuan in treasury debt that will expire in 2007 or after, excluding short-term bills issued, it has said.

Earlier this month the ministry said outstanding treasury debt stood at 3.26 trillion yuan in 2005. That was equal to nearly 18 percent of the country's 2005 gross domestic product of 18.23 trillion yuan, well below the level of most major economies.

But it was much higher than the 2.71 trillion yuan that media had previously reported.